The first thing to do is to create a budget or a cash flow plan and stick to it. Chef and I meet together every two weeks to discuss our budget. (Ramsey suggests doing this monthly, but since I get paid every two weeks and because some of our bills fluctuate, it’s easier for us to meet every two weeks.) We write down how much income we have for the pay period, and then subtract our expenses. We do not spend any money unless we’ve agreed on it. If something comes up, we have an emergency budget meeting (which for us can mean simply a telephone call) to discuss it. Following a budget has done wonders for both our spending habits and our marriage. We don’t have to wonder where our money is going, because we’ve agreed on every bit of it. Plus, we are communicating better than ever before.

We are currently on Baby Step 2. We hope to have paid off all our consumer debt (both personal and for Chef’s business) by November 2011.

In our class, one of the exercises was to have everyone anonymously write down their total debt, not including home mortgages. There are about twenty family units in our class. A family unit can be a single person, a married couple, or a couple with teenaged children. The total debt for the class was $1,313,952. Yes, that’s 1.3 MILLION dollars in debt among just twenty families. I was sick to my stomach when I completed the figures for that. What a burden!

Once Chef and I are out of debt, we intend never to go back in, with the possible exception of a 15-year, fixed-rate mortgage, should we decided to move. We will never use credit cards again. We will not borrow for college. We will not get a home equity loan. We will buy cars with cash.

It saddens me when people think debt is inevitable. Debt is like slavery (Proverbs 22:7 says “The rich rules over the poor, and the borrower is slave to the lender”) and it isn’t inevitable. You must work to make your money behave and to delay pleasure until you save the money you need. There is no doubt it’s work. But it isn’t impossible, and debt isn’t inevitable.

If you think we’re loony, then maybe we’re doing something right. Because if you always do what you’ve always done, you’ll always get what you’ve always gotten. And we don’t want to get what we’ve always gotten, so we’re making a huge change in our thinking about money.

I encourage you to buy or borrow Dave Ramsey’s book The Total Money Makeover. His Financial Peace book is good too. He explains all this much better than I do, and if I tried to do better, I’d just be plagiarizing anyway.

I am interested in your comments, though. Feel free! We totally drank the Kool-Aid, and I want everyone else to, as well. (And no, Dave Ramsey isn’t paying me to hawk his program or his books. That would be nice, though — I’d get out of debt faster!)

we’re doing it too….and it feels so….peaceful! Keep up the good work….and enjoy the blessings that come with it (like a better marriage, less stress, and strangely enough being more satisfied with what we have)!

Small Town Runner

Hi, I'm Karen. I like to run, and I live in a small town. Want more information? Start reading!